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Thursday, October 29, 2015

Can You Really Turn a Hobby into a Business?

The whole hobby-to-business proposition is a little
misleading—primarily because we need to rethink the word “hobby.” When
we hear it, we think of those fun, voluntary pastimes that bring us
enjoyment and help us make the most of our free time: reading,
collecting stamps, community theatre—they’re all things that we do
because we enjoy doing them. But is simply enjoying stamp collecting
enough to translate your hobby into a successful, thriving, and
sustainable career?

What we’re really talking about here is “passion.” When your hobby
becomes something all-consuming—that thing you think about all day long
during work and jump right into as soon as your time is yours
again—that’s more than a hobby; that’s a passion with potential. And
that passion is what represents something that can be both personally
and professionally sustainable.

Here are a few areas to consider before taking the leap.

Social Media—It’s Already Working For You
Your first stop on this journey from hobby to business is
unquestionably: Get Social. In my view, social media is still a
relatively untapped resource—and it’s one tool every hobbyist already
has at their disposal to do the most basic market research. Start with
Facebook and search for people with businesses like the one you’re
considering. Since it’s unlikely your idea is going to be of Tesla-level
uniqueness within the small business community, there will be many
similar businesses you can learn from. Which appeal to followers the
most? Which are most successful and why? Steal ideas with pride and
connect with followers to learn as much as you can.

When researching this topic, I immediately turned to my Twitter
community for insight. Using the hashtag #hobby2business I posted a
photograph, tagged eight of my followers from the small business world,
and asked for their advice on turning a hobby into a business. Within an
hour, coworkers from my office were retweeting and tagging others, and
my feed was full of #hobby2business content and advice. My favorite?
@PennyPower | Build community. Without social media, your use of it,
and the connections you make with the people who will help you, your
hobby will most likely remain just that.

Differentiate From Day One
What makes a good business? Remember the seven P’s of marketing:
product, price, promotion, place, packaging, positioning, and people.
As an entrepreneur, you’re going to need to define all of these things
in order to figure out where you stand in the marketplace—and how you
can do it better than everyone else.
First, intimately understand the product you want to sell. Even if
it’s a service, think of it as a product—what are its features? Why are
they appealing? What is the size of your target market, and what
percentage of that market do you anticipate will buy it? What are others
charging for something similar?

You’ll also need to consider
the logistics of getting your product to the people who want to buy it.
If you’re selling online, where would your consumers naturally go to get
your product? eBay? Amazon? Your own website? What apps will you need
to collect money and get paid? Will you need storage, packaging, or
shipping services? These channels are your routes to market, so defining
them will also help you build a strategy for finding customers and
making it as easy as possible for them to buy from you.

And while it’s important to identify these things, don’t overthink
it. Unless you are inventing a patented product (which is rare in the
hobby-to-business landscape) you’re probably going to differentiate on
price, service, audience, and the product itself in comparison to what’s
already out there. Embrace these things and use them to help set
yourself apart from the competition.

Business Is Both Fun and Dull All The Time

Fun is a small word with a huge
impact on our lives, so it makes sense that we’d prioritize injecting
fun into our business lives whenever possible. And, if you’re thinking
about becoming your own boss, the ability to capitalize on fun is
definitely one of the advantages: you can wear whatever you want, play
music while you work, control the tone and presentation of your
product—you’ll be in control of a lot of fun, new components of your
business.

However, even the most fun
business is still just that—a business. There are a lot of decidedly
un-fun and dull responsibilities that your business requires to remain
successful and profitable. Finance, administration, inventory—these are
all things most small businesses owners do not go into business to learn
how to do. That being said, there are ways to help minimize the impact
of these dull tasks so you can focus on the fun stuff:

Get a bookkeeper or an
accountant from day one. Explain that you are a very small business on a
shoestring budget, and that you don’t need corporate advice—you just
want to get the basics right.

You’re going to want mobile and online offerings first, so find a
bookkeeper who does the same. You’ll get the advice and help you need
without spending time and money travelling to meet them in person.

Use an accounting app that your bookkeeper recommends. Every dollar you spend on your business counts towards your success.

Learn the basics of accounting, invoicing, expense management, tax
returns, and cash flow. Accept that your success depends on it. You
don’t have to be an expert but you will fail without mastering the
basics of accounting.

For everything else you need help with, use sites like www.upwork.com and www.peopleperhour.com to get freelance help. These sites offer experts on demand and at an affordable price.

Do The Math and Get More Help

Fundamentally, every business
needs to answer this simple equation to find success: revenue minus
cost. To make sure your business is financially stable, start by
figuring out how much income you need along with how much product you
need to sell, and what your costs are. Then you’ll need to calculate how
to manage the cash flow (the money you need to make the business work)
as you ramp up. Keep going over these numbers.

If you are useless at numbers,
don’t give up—get help! It’s a given that you will be weak in some areas
of your business—after all, your passion for your hobby is not enough
to keep a business up and running smoothly. The good news is that anyone
in marketing, finance commercial management, product management, or
your bookkeeper can help you. And don’t forget your friends and
neighbours: your community includes people who will do things pro bono,
provided that you can help them back. Be open to this. The social-first
generation is all about mutual support (and that’s what makes it
awesome!).

Your “Why” Should Not Be Because You Hate Commuting

In his book Start with Why?, Simon Sinek challenges what and how thinking. While what and how are the yin and yang of everything, why is the driving force. So why didn’t I start the article with the why?
Because the hobby-to-business process is agile rather than
step-by-step—you need to consider each of these areas over and over; you
can refine your why as you go.

But first, ask yourself why
you want to make a career out of your hobby? Boil down the essence of
your purpose because it will drive you to success. Without identifying
the why you will not tap into the real reason you are changing
your life. If that sounds bold, it is—you’re changing your life for a
reason and you should be able to explain what that reason is; whether
it’s to save your health, become the person you were told you couldn’t
be, or because the real you is not stuck in a call center, defining the
real, fundamental reasons why you want to transform your passion into
your business will help you ultimately be more successful. Try to
complete this sentence:

I am doing this to [enter bold life-changing statement here].

If we all did this, we’d change the world faster. Define the why today and reach for the highest branch.

Be Ready To Put Yourself First

Corporations create context,
like a river that flows: join in and drive and you’ll be part of the
solution; float along and you’ll end up as part of the problem. We’ve
all been there at one time or another.

Your hobby-to-business journey includes the acceptance that you
will now be the river. No one else is going to create the environment,
motivation, and drive you need to get things accomplished. As the owner
of a business, you are on your own.

To be the best you can be, put
yourself first. For me, it’s important to exercise every day, eat
healthfully, and get the right amount of rest. If that meant buying a
spinning bike for my house or cooking and freezing healthy meals in
batches to save time—so be it. Make sure you can identify what keeps you
happy, healthy, and grounded before you make the jump to living your
passion on a full-time basis. When you are your own company, you’re the
source of your own success; make sure the journey is worth it.

Conclusion

Now more than ever we are
encouraged to do what we love. After all, life’s too short for a boring
job, bad bosses, and doing something you hate just to earn a paycheck.
And because technology now enables work to be a thing you do rather than
a place you go, the opportunity to identify and develop unique career
pathways is greater than ever! For example, social, political, and
environmental awareness has helped organizations such as Freecycle to
flourish; a global movement toward embracing “makers” has built
revolutionary sites like Etsy. We’re blessed, as a society, with an
unprecedented combination of time, technology, information, and the
quantified self: yes, we want it all.

And we can have it, too—as long
as we channel our passions in the right places. For all of you who are
thinking about turning your hobby into a business, I hope you found
these insights helpful and I wish you luck!

About the Author
Nick Goode is the Global Commercial Director of Sage One,
Sage’s cloud accounting and payroll solution for start-ups and small
businesses. Goode is accountable for the commercial, channel, product
and marketing strategy for Sage One worldwide. Goode is previously Head
of Sage One for Sage UK, and prior to that, Head of Marketing for the
Accountants Division at Sage. His LinkedIn can be viewed at https://www.linkedin.com/in/nickgoodeuk and his Twitter handle is https://twitter.com/nickgoode?lang=en.

About Me

Kathryn Darden is a mentor for a growing international team of entrepreneurs. As a journalist she writes arts & entertainment and skin care articles for several online publications including Christian Activities and Examiner. She is an Executive Consultant with Rodan + Fields Dermatologists.

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